CASH FLOWS AND BALANCE SHEET

During the year a three-year revolving credit facility of US$1,4 billion was raised to fund the Tradus acquisition. The balance sheet remains sound with a gearing ratio of 11%, excluding transponder leases. Free cash flow generated by the group in the current year was R2,2 billion, similar to last year.

SIGNIFICANT ACQUISITIONS

In March 2008 the group acquired 100% of the issued share capital of Tradus plc., a company providing online consumer trading platforms and related internet services that connect buyers and sellers. The consideration was R15,3 billion, including acquisition costs of R74 million. The group is currently finalising the purchase price allocation and has recorded the purchase consideration, based on a preliminary appraisal, as follows: net tangible assets (R491 million), intangible assets (R461 million) and the balance to goodwill.

In December 2007 the group acquired 97% of the issued share capital of Gadu-Gadu S.A., the leading instant-messaging platform in Poland. The cost was R1,1 billion, including acquisition costs of R29 million. The group has recorded the purchase consideration, based on an appraisal, as follows: net tangible assets (R191 million), intangible assets (R224 million) and the balance to goodwill.

In December 2007 the group acquired 100% of the issued share capital of Cloakware Inc., a company providing software security solutions, for a consideration of R505 million. The group has recorded the purchase consideration, based on an appraisal, as follows: net tangible liabilities (R204 million),
intangible assets (R485 million) and the balance to goodwill.

The revenues and profits recorded from these acquisitions were not material to the group’s consolidated results for the year.

In November 2007 the group finalised its acquisition of a 40% interest in M-Net/SuperSport as announced in November 2006. The total consideration was settled through the issuance of 21 601 667 Naspers N ordinary shares and R250 million in cash. The fair value of the shares issued was R180 per share on 30 November 2007. The group has recorded the purchase consideration, based on an appraisal, as follows: net tangible assets (R369 million), intangible assets (R528 million) and the balance to goodwill.

DISCONTINUED OPERATIONS

In October 2007 Media24 announced that it had accepted an offer to sell its private education business, Educor, which was sold as a going concern. Media24 has retained certain minor assets. Educor incurred a net loss from operations of R153 million during the year ended 31 March 2008. The group also recorded a loss on discontinuance of operations of R82 million.

In October 2007 the group announced that it had initiated a formal process to sell NetMed. In April 2008 the group made a further announcement that it had entered into conditional sale agreements for the disposal of NetMed to ForthNet SA. NetMed recorded a net profit from operations of R396 million during the year ended 31 March 2008.

These transactions have been accounted as discontinued operations in accordance with IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations”.

ACCOUNTING POLICIES AND CHANGES IN ACCOUNTING TREATMENT

The financial results are prepared in accordance with International financial Reporting Standards (IFRS), the requirements of the South African Companies Act, No 61 of 1973, and in compliance with the Listings Requirements of the JSE Limited. The accounting policies used to prepare the results are consistent with those applied in the previous period, except for the changes in accounting standards as indicated below. A copy of the unqualified audit opinion of the auditor, PricewaterhouseCoopers Inc., is available for inspection at the registered office of the company.

Changes in accounting standards

IFRS 7 “financial Instruments: Disclosures” – The standard requires new disclosures on financial instruments to those currently mandated by IAS 32 “financial Instruments: Presentation”.

Amendment to IAS 1 “Presentation of financial Statements: Capital Disclosures” – The amendment requires additional disclosures of the group’s objectives, policies and processes for managing capital.

The group has provided the disclosures, including comparative information, in the relevant notes to the annual financial statements included here.

Circular 8/2007 “Headline Earnings” - This replaces Circular 7/2002 “Headline Earnings” and provides detailed guidance for calculating headline earnings as required by the JSE. The circular was adopted by the group and had no material effects on the group’s previously reported results.

Financial review

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